Weaving Your Way Out Of The Personal Bankruptcy Maze
Posted at by PConran on category BankruptcyThe economy is in very bad shape right now. When the economy tanks, many people lose jobs and accumulate debt. Debts can result in filing for bankruptcy, which can seem to be a terrible thing. This article can help you or someone you care about if bankruptcy is a consideration.
Individuals often seek to file for personal bankruptcy protection if their debts exceed their ability to repay them. If this describes your situation, it makes sense to become familiar with relevant laws. Bankruptcy laws vary from state to state so it is important to do your research. You may find your home is safeguarded in one state, while in another it isn’t. Know what the laws are in your state before filing.
Prior to filing for bankruptcy, be sure you have investigated all of your alternatives. You have better options. For example, you could try credit counseling. Bankruptcy leaves a permanent mark on your credit history, so before you take such a large step, you want to exhaust all other options so that the future effects on your credit history are as minimal as possible.
Don’t file for bankruptcy until your represented by an attorney. Personal bankruptcies are detailed and complex processes, and you may miss something that costs you money. A specialized bankruptcy lawyer can ensure that you are handling your bankruptcy filing the right way.
Be aware of recent changes, if any, in the bankruptcy code. Bankruptcy law evolves constantly, and it’s important to stay up-to-date to ensure that you file properly. Your state will have a website to check, or a number you can call, to learn the latest changes in the bankruptcy laws.
If your income exceeds your obligations, you should not seek bankruptcy protection. Understand that while declaring bankruptcy will eliminate many of your debts, you will have difficulty obtaining credit and will pay more in interest for the credit you do receive for at least seven years.
Filing for bankruptcy should not be done on a whim. Find out if you can receive a reduced interest rate or altered repayment plan instead of bankruptcy filing. A plan that can be useful when foreclosure is looming is a loan modification. This type of plan allows your lender to work with you eliminating charges, extending your loan, and lowering interest rates to help you pay back the loan without drowning in debt. After all is said and done, your creditors will still want their money. For this reason, you may wish to investigate debt repayment programs in lieu of bankruptcy programs.
If keeping your vehicle is of great concern, ask your lawyer if you can secure a payment modification. Many times, payments can be lowered through Chapter 7 bankruptcy. You need to have bought your car 910 days before you file, have a loan with high interest and you’re also going to need a good work history.
Carefully consider filing for bankruptcy on loans that have a co-signer, especially if that co-signer is a business associate, close friend or relative. A Chapter 7 bankruptcy will relieve you of your legal responsibility to pay any joint debts. However, if you had a co-debtor, they will be required to pay the debt.
While the economy is beginning to gather steam, a number of people still do not have jobs or acceptable compensation. Even if you do not have a lot of money, there are many ways to prevent filing for bankruptcy. This article has likely given you some ideas on how you can protect yourself from having to file for bankruptcy. Best of luck to you.